Following on from our blog on Staff Gifts, it’s time to look at Christmas Parties…
There are certain Tax, National Insurance and reporting obligations for social functions; however HM Revenue & Customs (HMRC) deem some events exempt so it might be worth bearing this in mind when planning your next staff do.
Events are exempt if they meet the following criteria:
- The event is annual (such as the Christmas Party, or a summer BBQ)
- Costs less than £150 per head (including VAT)
- Is open to all employees
If you have offices based in different locations or you want to put on separate parties for different departments, these will still be exempt as long as all your employees can attend one of them.
If any of your events don’t meet HM Revenue & Customs exempt status then you’ll need to:
- Report on each employees form P11D
- Pay Class 1A National Insurance on the full cost of the event.
This article is offered as a guide to Christmas parties, and does not take into account individual employer or employees circumstances. Should you have any queries regarding employee benefits, payroll or general tax advice please contact us.